Gardner Merchant gets into bed with Friendly

Gardner Merchant Sodexho has signed a deal to run food and beverage operations in 44 UK hotels owned by Friendly Hotels.

The contractor will take over restaurants, bars, room service, banqueting and hospitality for Friendly.

As well as its owned hotels, Friendly has 36 franchised hotels in the UK, which are to be offered the service.

Sodexho is keen to break into the provision of services other than food but Friendly managing director Peter Cashman said there had been no talks to extend the contract.

But Simon Marshall, managing director of Sodexho's Hotel and Commercial Restaurants division, said: "We are in talks with several other hotel groups and property developers about full management contracts."

Friendly is to pay Sodexho a flat fee for the three-year contract and Sodexho has guaranteed that it will increase the 29% gross profit margin by at least 2%.

Current turnover for food and beverage in the 44 hotels is £19m a year. This is expected to increase to £33m over the next three years.

"Like any contractor, Sodexho will get retrospective discounts from suppliers that they will keep," said Cashman.

Sodexho will introduce branded restaurants to the hotels, including Seasons, Caffe Toscana and Rhodes & Co, which already exists at the Quality Hotel in Manchester.

Sodexho has also signed a franchise agreement with the Arbuckles Group to open 30 Arbuckles American Cafés over the next five years. It plans to bring these into Friendly's hotels as well.